Should a Board Use a Horse Race to Choose a Company’s Next CEO?

While some governance observers are wary of using a horse race to choose a company’s next leader, others argue that the approach — an overt contest among recognized candidates within an established time frame — is an effective tool. But before a board decides to use such a process, it must consider how the contest may affect the organization. Depending on how the competition and the choice are handled, a horse race could have a lasting impact on the strength of the company’s leadership pipeline. For example, an unsuccessful candidate might resign or align with a strong competitor. The company might also lose the loyalty of executives who might have been slated to fill key management roles in the future.

Moreover, it is impossible to ignore the cruel underbelly of thoroughbred horse racing. Behind the glamorous façade, horses are forced to sprint — often under the threat of whips and illegal electric-shocking devices — at speeds that can cause gruesome breakdowns, injuries, and hemorrhages from the lungs. In addition, the sport’s trainers use cocktails of legal and illegal drugs that can mask injuries and artificially enhance performance.

Many races are handicapped, meaning that the amount of weight a horse carries during the race is adjusted to take into account its age, past performances, and other factors. For example, a two-year-old must compete with older horses that are heavier than it is. Similarly, a filly is allowed to carry less weight than a stallion. And a horse’s pedigree is taken into consideration as well, with certain breeds not eligible to race against others.

Sadly, horse racing is losing fans, revenue, and race days, as people become aware of the dark side of the sport. In the United States, for instance, attendance in grandstands that once held tens of thousands now holds dozens. Moreover, the industry is plagued by drug abuse, broken horses, and illegal animal cruelty.

A growing number of people are calling for serious reforms, and there are signs that the naiveté of some racehorse owners is starting to fade. However, the number of crooks who drug or otherwise mistreat their horses and the dupes who labor under the fantasy that the industry is broadly fair remain a formidable obstacle to change. Until the crooks are outlawed, and until those who know better than to stand by and watch are convinced to give up their careers for good, horse racing will continue on its perilous course. For more information on the issue, including the exploitation of young horses, drug use, and the slaughter of horses after they stop winning or breaking down, see PETA’s thorough investigation into the horse racing industry. The report also includes links to videos that show abusive training practices for young horses and the slaughter of injured and ill horses at the end of their racing careers.